Another slots dog & pony show. More lavish promises and optimistic plans. Annie Linskey covers Tuesday's public hearing on plans for Rocky Gap, the white-elephant resort that has failed to secure a slots developer for a while now. At least developers are interested:

One group that wants to open a casino at the Rocky Gap Lodge and Resort envisions amenities including five restaurants, a spa, a golf and tennis academy and an automobile museum. The other promises to invest $62 million to build a 50,000-square-foot gambling palace and stresses that its team has the experience to get the job done.

But all the plans and artist renderings in the world won't make a Rocky Gap offer work without financing. Developers need their own capital or a banker's to sink millions into this resort. And capital is hard to come by in this economy. Lack of financing has killed slots offers over and over. Lobbyist and former House Speaker Caz Taylor, who represents the Rocky Gap bondholders, said nice things about the offers to the Cumberland Times-News:

“Both proposals are quality proposals,” said Casper Taylor Jr., who represents bondholders in the resort. “This is good news for our local economy, which is in need of good news.”

That suggests bondholders could accept one of the offers instead of foreclosing on Rocky Gap. (The bondholders are the only party likely to get any money back from previous investments in Rocky Gap. Not the state.) But to pay the bondholders and invest in the property, developers have to come up with dough. Whether they can is not a sure thing.

Posted by Jay Hancock at 9:03 AM | Permalink | Comments (0)
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Friday is the deadline for bidding on slots at the state-owned Rocky Gap resort. The provisions of the offer also require bidders to take Rocky Gap, a longtime white elephant, off the state's hands. There was some doubt as to whether anybody would be interested and whether the state would be 0 for 3 in trying to get somebody to put slots out there. Now, reports the Post's John Wagner:

Landow said in an interview that his family-owned company will place a bid on Friday, when applications are also due for a slots site in downtown Baltimore, where 3,750 machines are allowed.

Landow said he would propose adding and upgrading other amenities at the lodge, which was financed by the state and has long struggled to become profitable. The property already includes a day spa and an 18-hole “Jack Nicholas Signature Golf Course.”

Posted by Jay Hancock at 8:52 AM | Permalink | Comments (0)
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OK, I would like financial statements certified by auditors before drawing any firm conclusions about business at the Maryland Jockey Club, owner of Pimlico and Laurel race tracks. As Hanah Cho reports, the tracks lost a combined $26 million in 2008 and 2009, according to unaudited books presented by the owner. The General Assembly is considering increasing the subsidy from slot machines for the tracks.

Whatever the numbers, however, financial trauma at the tracks is impossible to deny. The revenue line, which is difficult to get wrong in a highly regulated industry, shows "a drop in wagering revenue from 2007 to 2009: $48 million to $37 million at Laurel Park and $35 million to $27 million at Pimlico," Cho reports, from 2007 to 2009.

The question is how much of this is cyclical. 2007 was a normal economic year. 2009 was the trough of a terrible economic slump. I'm not saying the industry doesn't have long-term problems. But some part of this, as John Franzone says in the story, is temporary.

Posted by Jay Hancock at 9:55 AM | Permalink | Comments (3)
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WBAL's Bill Vanko and I yack about these topics, including The Daily Record's story on Penn National's contemplation of pulling out of the Maryland Jockey Club.

Posted by Jay Hancock at 11:47 AM | Permalink | Comments (0)
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Here are WBAL's Bill Vanko and me talking about David Cordish's defamation lawsuit against the Maryland Jockey Club, Penn National and some former Indiana gambling partners.

Posted by Jay Hancock at 11:22 AM | Permalink | Comments (1)
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Lt. McCullough excuses the poker bust because the "high-stakes game" -- $65 buyin! -- might have actually, someday, maybe had something to do with something that harmed society.

"These are financial crimes, and while it might appear on the surface that it's harmless, it festers into other crimes," said Lt. Robert McCullough, a county police spokesman.

It's an admission that the game itself wasn't a problem. Don't mean to pick on Lt. McCullough or the Baltimore County police; they enforce the law as it's written.

But it's a fair question to ask why the law allows Penn National Gaming to sponsor gambling in Maryland but doesn't allow the folks who were charged here. Now that the morality-based or social-wholesomeness arguments against gambling have been tossed out, the only justification for busting these guys is to maintain the government's gambling monopoly. That doesn't have quite as high-toned a ring as the old arguments.

Posted by Jay Hancock at 9:35 PM | Permalink | Comments (7)
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My holiday got extended a bit by some viruses/bacteria. Sorry for the scarce posts and comment moderation. Happy to see that the neverending slots/horse racing story has never ended. I liked this bit of blue skying by The Sun's editorial page. Sell Rosecroft to Angelos and start holding throuroughbred meets there, thus rescuing the thoroghbred trade from the Maryland Jockey Club. The Sun:

Another tantalizing possibility is that Mr. Angelos could try to bring thoroughbred racing to the track. Mr. Angelos himself is a breeder of thoroughbreds, and the thoroughbred industry, despite a recent deal brokered by Gov. Martin O'Malley to keep the tracks open this year, faces an uncertain future. The feuding between Penn National and MI Developments, the joint owners of the Maryland Jockey Club, makes it difficult to see how the industry could develop and execute a viable plan for resurrecting its business. While Rosecroft couldn't fully take the place of the two existing thoroughbred tracks, it could at least offer a refuge for the state's horsemen and keep the industry alive while the ownership of the Maryland Jockey Club is straightened out.

The editorial gives a good overview of what has happened and what is likely to happen with Angelos and Rosecroft, and the whole thing is worth reading.

Posted by Jay Hancock at 12:01 PM | Permalink | Comments (3)
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Granted, I'm dumb about politics. Legislatures, politicians and voters constantly surprise me with this or that. But it's really really hard to imagine the General Assembly paving the way for slots at Laurel Park. Hanah Cho reported on Friday that, despite everything, Penn National, Frank Stronach's partner in the Maryland Jockey Club, said it would seek slots at Laurel.

Meanwhile, the tracks' minority owner, Penn National Gaming, said it would pursue slots at Laurel Park, which means lobbying to change the state constitution to allow a second casino in Anne Arundel County when the General Assembly reconvenes next month. Amending the constitution is a complicated and uncertain process.

The Jockey Club could have had Laurel slots, but it blew it. It could have submitted a bid for slots that was on time and included the required deposit. It didn't. It might have succeeded in challenging David Cordish's competing slots proposal on technical grounds. It couldn't. It might have won the November referendum outlawing Cordish's project at Arundel Mills. It lost.

Due process would seem to have been tried, tested and exhausted. And granting a Laurel license would be grossly unfair to Cordish, who competed fairly under the rules that looked for all the world to be permanent and unchanging. Give us a break, Penn National.

Posted by Jay Hancock at 8:57 AM | Permalink | Comments (10)
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John Scheinman of Thoroughbred Times gets what I think is the first interview with Frank Stronach, who runs Pimlico and Laurel Park through MI Developments, since I talked to him three weeks ago. Don't worry, says Frank, everything will be fine!

From the Thoroughbred Times story:

“I will come down to Maryland next week,” Stronach said Thursday from his native Austria. “We’ll try to find common ground. It has to be done quickly. We’ve got a good relationship with the horsemen; the racing commission trusts us too.”

Stronach declined to comment on the status of a winter meeting in 2011 at Laurel Park; the fall meeting concludes December 18, and no arrangements for racing or simulcasting are scheduled beyond December 31—jeopardizing the future of thousands of racing-related jobs in Maryland. The four off-track outlets in the state also would lose their signals.

The lack of an agreement for 2011 also throws into doubt the future of the Preakness Stakes (G1), middle leg of the Triple Crown.

AP also appears to have reached Stronach. Story here.

Posted by Jay Hancock at 6:25 PM | Permalink | Comments (6)
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So it looks like Frank Stronach isn't going to hold races 140 days next year at Pimlico and Laurel after all. Earlier this month he told me he would. But Monday night Stronach's Maryland Jockey Club submitted a plan to the state with only 47 racing days -- 30 at Pimlico and 17 at Laurel. Not surprisingly the racing commission saw this as tantamount to smothering the industry and rejected the plan. But this isn't the end. Expect some sort of compromise that bumps up the number of days and of course includes the Preakness, Pimlico's big (only) moneymaker.

The most charitable thing that can be said about Stronach is that his intentions are good but that he has trouble fulfilling his vision and that he keeps choosing inappropriate business partners. He bought the tracks by agreeing to give the previous owners, the De Francis family, enormous portions of any potential slots profits. He almost immediately regretted it and tried in vain to renegotiate the deal. Wrangling over reducing the De Francises' slots cut delayed and then sabotaged the Jockey Club's bid for a slots license at Laurel Park, which allowed David Cordish to swipe the prize and put slots at Arundel Mills.

Now Stronach has gone into league with Penn National, the gaming company, which naturally seems to have been more interested in slots profits than in horse racing. As co-owner of the tracks, Penn National wants to cut their losses by reducing races. And the company seems to have substantially overruled Stronach, although the previous plan to shut down Laurel altogether was modified. Even a compromise with the racing commission probably won't give the industry enough meets to test how slots-fattened purses draw crowds and contenders. Just when the thoroughbred community thought things couldn't get any worse, they got worse.

Posted by Jay Hancock at 10:14 AM | Permalink | Comments (10)
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Here are WBAL's Bill Vanko and me talking on the radio this morning about developments at the Maryland Jockey Club, Laurel Park and Pimlico Race Course that are far more entertaining than anything going on at the tracks or the slots casinos.

Posted by Jay Hancock at 11:10 AM | Permalink | Comments (0)
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Today's column turned into news when Frank Stronach, the Canadian tycoon who controls Laurel Park and Pimlico Race Course, told me he would reverse his organization's move to end live racing at Laurel and race only 40 days a year at Pimlico.

The obvious question is: What the heck? For two weeks Jockey Club President Tom Chuckas has been saying in no uncertain terms that the approval of slots at Arundel Mills on election day would mean the end of racing at Laurel. He said so before voters said "Yes" to Arundel Mills, and he said so afterward. Obviously the threat to downsize Maryland thoroughbred racing turned out to be a bluff.

I wouldn't blame Chuckas for bad faith, however. I suspect Stronach switched agendas on him. He has a history of this kind of thing. The Jockey Club flipflopped on plans for the Pimlico backstretch before finally closing it. Stronach talked at one time about tearing down Pimlico and rebuilding it. That obviously never happened.

As if to prove that Stronach has more money to put into the tracks if he chooses, he spent $2.3 million over the weekend, doubling the auction reserve, to buy a pheenom filly named Awesome Feather. From the Thoroughbred Times:

Frank Stronach, the owner of Adena Springs and chairman of MI Developments Inc., went to $2.3-million to acquire Grey Goose Breeders’ Cup Juvenile Fillies (G1) winner Awesome Feather during the Fasig-Tipton Kentucky selected mixed sale on Sunday in Lexington.

“She’s a nice filly, what more is there to say?” Stronach said. “Her disposition—she is very calm. Her race record speaks for itself.”

Posted by Jay Hancock at 8:00 AM | Permalink | Comments (4)
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The referendum against slots at the mall always was a long shot. The margin of victory for the David Cordish-backed project, however, is surprising, considering how much dough the Jockey Club spent on advertising. It has been buying TV ads -- tons of them -- since August.

I suspect the nonstop ads -- eventually from both sides -- blurred together and prompted voters to draw a larger desire from the slots debate: Make it stop. Make it stop now, please. The best way to do that was to vote for Cordish. Had he lost, we would have been reading and hearing about slots-site debates for years. The Jockey Club would have tried to get a license for Laurel Park. Cordish may have tried for another site. More money would have been blown on lawyers. More neighborhood groups -- the ones in Laurel, this time, especially Russett -- would have gone militant against slots in their neighborhood. Even if you didn't care about slots at the mall, the way to put an end to the noise was to vote for Cordish.

The Jockey Club and other mall-slots opponents made the decision to tout Laurel Park as the alternative site -- saying over and over again in their ads that it was the appropriate place for slots, not the "family" mall. I wonder if that was the right tactic. In doing so they focused attention on the Jockey Club's botched attempt to put slots at the track in the first place. Every time they promoted the track as the right place, the subtext was: "Well, you already had a chance to get slots, and you blew it."

Posted by Jay Hancock at 8:36 AM | Permalink | Comments (22)
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A post yesterday highlighted the claims of Laurel residents who say that Laurel Park racetrack is not a legal slots site because it's not within two miles of Maryland Route 295, as required in the slots enabling legislation.

Laurel Park is held out as the great Anne Arundel County slots hope by people who want to defeat David Cordish's proposal to put a big slots palace at Arundel Mills mall. But the road known as 295 that goes through Laurel is really the Baltimore-Washington Parkway and is owned and maintained by the National Park Service, not Maryland, say people who live in Laurel and don't want slots there. So it's really not Maryland 295 at that point and Laurel Park is not a legal option for slots, they say.

Wrong, says Alan Rifkin, a lawyer who represents the Maryland Jockey Club, which owns Laurel Park. "The claim that Laurel Park is not within the authorized Anne Arundel County VLT zone is sheer nonsense as a matter of constitutional law and statutory interpretation," he says via email.

As he notes, the slots enabling legislation mentions Laurel Park many times, and not just as a potential recipient of slots proceeds for purses. It specifically mentions Laurel Park as a potential slots site. To wit:

(4) IF A VIDEO LOTTERY OPERATION LICENSE IS ISSUED TO A RACETRACK LOCATION AT LAUREL PARK, THE VIDEO LOTTERY OPERATION LICENSEE SHALL:

Then it lists a bunch of conditions. This language would seem to make it tough for anybody to argue that Laurel Park is an illegal slots site, even with the argument that the track might not be technically within two miles of "MD RT 295," as specified by the statute.

Here is Rifkin's full message:

The claim that Laurel Park is not within the authorized Anne Arundel County VLT zone is sheer nonsense as a matter of constitutional law and statutory interpretation.

The authorizing statute from which the Constitutional Amendment was drawn specifically references Laurel Park by name multiple times, imposing various conditions upon Laurel Park if it is awarded the VLT license, including preservation of the Preakness and the Maryland Million – references

Continue reading "Lawyer: Laurel Park is close enough to 295 for slots" »

Posted by Jay Hancock at 6:00 AM | Permalink | Comments (10)
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A big talking point of opponents of slots at Arundel Mills is: Let's put slots at Laurel Park raceway instead of Arundel Mills. Then Anne Arundel County can still get the slots revenue and the casino will be where gambling already happens. Mall-slots opponents want, as the ads say, "to put slots in a better location in Anne Arundel County, Laurel Park."

After all, Laurel Park is within two miles of Maryland Route 295, where slots are allowed under state law. Right? Everybody expected slots to go to Laurel Park, anyway, before the owners stumbled and left the way open for the Cordish Cos. to make a proposal for the mall.

The Constitutional amendment permitting Maryland slots in certain locations specifies one of the locations as: "(I) ANNE ARUNDEL COUNTY, WITHIN 2 MILES OF MD
ROUTE 295;"

But activists who live in the Russett neighborhood, near Laurel Park, say that the racetrack is not within two miles of Route 295. Slots at the track aren't allowed under the Constitution, they say.

They may have a case. True, the race course is within two miles of the Baltimore-Washington Parkway, also known as 295. But the portion of the road near Laurel is under federal, not state control, so you could argue that it's not really "MD Route 295." According to the Maryland State Highway Administration, the state owns and maintains the road from the Baltimore City line in the north to just past the intersection with Maryland Route 175 in the south. (That's more than 4 miles from Laurel Park, according to Google Earth.) After that, says SHA spokesman Charles Gischlar, "the federal government picks it up."

What's more, below 175 and extending through Anne Arundel County, there are no signs on the road designating it as "295," Gischlar says.

What's the road called as it passes Laurel?, I asked National Park Service spokesman Jeffrey Olson. "As far as I know we call it the Baltimore-Washington Parkway," he said.

"I completely understand that I'm splitting hairs here," says Joe Franco, who's on the board of the Russett homeowner association and is trying to draw attention to the federal status of the parkway near Laurel Park.

Maybe, but it looks like the law could

Continue reading "Does legal slip make Laurel slots unconstitutional?" »

Posted by Jay Hancock at 6:00 AM | Permalink | Comments (11)
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As Nicole Fuller reports in today's paper, a Baltimore Sun poll shows basically a tie in Anne Arundel County on the question of allowing slots at Arundel Mills mall.

Forty-seven percent said "yes;" 45 percent said "no." But as the article notes, there is a fairly large margin of error. While Opinion Works interviewed 798 likely voters for The Sun's Maryland-wide poll, they interviewed 422 voters for the Anne Arundel referendum, a smaller sample and one less likely to reflect countywide opinion. Only Arundel residents get to vote on slots.

The people Fuller interviewed seem quite knowledgeable, distinguishing between slots in the mall and slots next to the mall, knowing that Laurel Park is the putative alternative but wondering whether it's likely, etc. Mall-slots backers and opponents are expected to crank up their ads in the last days before the election, but I wonder whether they'll be lost in all the other election-ad garbage that is airing.

Posted by Jay Hancock at 8:26 AM | Permalink | Comments (2)
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As Hanah Cho reports in today's paper, a David Cordish project in Indiana -- managing the Indiana Live! casino for landlord Indianapolis Downs -- has hit a setback, as Indianapolis Downs tries to terminate or change the terms of Cordish's contract.

The racetrack is in miserable shape. Its debt is rated way into the junk category. Why it isn't already in bankruptcy proceedings is a bit of a mystery. But its casino seems to be running very well, spinning money for its owners at the high end of the industry scale, Cho reports. If there's any lesson for Maryland here, it's that casinos aren't a guaranteed savior for racetracks. (The Indianapolis Downs casino does, however, seem to have more competition than Cordish's casino planned for Arundel Mills would. And I assume the revenue-sharing terms are different than they are in Maryland.)

How Indianapolis Downs thinks it can terminate the Cordish deal without going into bankruptcy is unclear. As Jeffries analyst John Maxwell told Cho: "The question really becomes 'Are they legally allowed to terminate the management agreement?'"

Cordish's competence in running the Indiana casino doesn't seem to be in dispute. The company has a successful record running other facilities. There's no reason to believe Arundel Mills would be any different, whether you're for it or against it. The Indiana dispute seems to be a fight for the lawyers and a setback for Cordish, but not a reflection on Cordish's managment.

Posted by Jay Hancock at 8:33 AM | Permalink | Comments (9)
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Not surprised that election-finance filings show more contributions and ad-spending from opponents of slots at Arundel Mills than from proponents. Anti-slots TV ads have been much more abundant. I am surprised, however, that the Cordish Cos. so far have spent less so far than mall owner Simon Property. As Nicole Fuller writes in the paper, Simon subsidiary Arundel Mills LP has contributed $2 million while Cordish companies have put in $600,000.

The campaigns raise questions about timing. Anti-slots ads have been running in heavy volume since August. Did opponents spend too much too early? Slots backers, on the other hand, seem to be saving their powder for the final weeks -- or maybe they have private polls that show they don't need to go crazy. In any event expect spending numbers to go up sharply for both sides before it's all over, after which TV viewers will be very happy.

Posted by Jay Hancock at 9:00 AM | Permalink | Comments (0)
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Very good piece in the Annapolis Capital by Liam Farrell on what happens if the Cordish slots proposal for Arundel Mills mall is defeated in referendum next month. The short answer: It's far from clear.

The commission's members have already staked their position on such a scenario. Chairman Donald Fry said last week they will not do anything - they will not revoke Cordish's license award, they will not start the process for seeking new bids on the Anne Arundel site - until the County Council moves with zoning legislation again.

This game of chicken has been done before. In 2009, the commission and council stared each other down for months over whether Cordish should be awarded a license before Arundel Mills was properly zoned.

Eventually, the commission moved first, but Fry said this time they would wait to not only see what the council does with zoning, but also to make sure such legislation can no longer be petitioned to be overturned.

Posted by Jay Hancock at 8:48 AM | Permalink | Comments (2)
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After weeks of anti-slots-at-the-mall TV ads, David Cordish is out with his first pro-slots spot, reports Nicole Fuller in today's paper. The ad is simple and direct, talking about jobs and revenue with wholesome images of ethnically diverse citizens working and studying.

As anti-slots-at-the-mall leader David Jones points out, the ad doesn't note that there are other potential slots locations in Anne Arundel County. Of course the anti-slots ads, which promote Laurel Park as the alternative, away-from-"families"-and-residences site, don't say that there are problems with that location also and that slots could potentially end up at some third, unspecified county location.

Posted by Jay Hancock at 8:42 AM | Permalink | Comments (5)
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Martin O'Malley spokesman Rick Abbruzzese pushes back against a Sun editorial, "O'Malley's Reckless Slots Politics," that slams the governor for backing a referendum against a slot-machine parlor at Arundel Mills mall. "Mr. O'Malley has recently publicly supported the referendum and has indicated that he will seek to make an issue of Mr. Ehrlich's ties to the effort to bring slots to the mall," the Sun said, saying the move "smacks of political opportunism."

Abbruzzese says O'Malley has always preferred slots to be at the horse tracks, offering as evidence a piece in the Sun from October that said: "Gov. Martin O’Malley has said repeatedly that he would prefer to have slots at horse tracks, where patrons already are allowed to gamble. He has publicly urged the County Council to act - either for or against the mall project - saying that the slots program needs to move forward." Also, a Washington Post piece from the same time said: "Maryland Gov. Martin O'Malley (D) said Friday that he 'will not be angry' if a local zoning decision sinks the state's largest proposed slots casino at Arundel Mills mall."

Maybe not being being angry about a defeat for Arundel Mills slots is not the same thing as publicly sympathizing with the people trying to defeat Maryland's best, largest hope for significant slots revenue anytime soon. Here's O'Malley in the WP a few days ago:

"I can certainly understand why the people of northern Anne Arundel County would prefer not to have a slots emporium at a mall in a residential area," O'Malley said in an interview. "If I lived there, I'd rather see it at a racetrack."

Posted by Jay Hancock at 8:00 AM | Permalink | Comments (5)
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When Mr. O’Malley proposed expanded gambling during a special legislative session in 2007, he made clear his hope for a relatively limited slots program at the racetracks. If Mr. O’Malley held such a strong conviction that slots didn’t belong at the mall, that might have been a good time to mention it... He might also have made his objection to slots at the mall known when the Cordish Cos. announced its Arundel Mills proposal, or when it became the sole qualified bidder for the Anne Arundel site after the Maryland Jockey Club, owned at the time by the bankrupt Magna Entertainment Corp., failed to put forward the required licensing fee with its application. Instead, he sat on the sidelines while the Anne Arundel County Council spent months debating slots zoning, while the jockey club funded the petition drive for the referendum and while both sides battled over the legality of the referendum in court.

For more on election pandering by O'Malley (and Bob Ehrlich) see today's Hancock column.

UPDATE: Andy Green wrote the post but Cross-Barnet posted it for him.  

Posted by Jay Hancock at 11:47 AM | Permalink | Comments (1)
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Sorry for radio silence. Been out of town for a few days. I'll be looking into this further today. But I'm wondering something about the Court of Appeals ruling on the referendum against David Cordish's proposal to put slots at Arundel Mills mall.

The courts have never allowed a full legal challenge to the validity of the petition signatures in favor of an anti-slots referendum. At the trial Judge Ronald Silkworth disallowed evidence offered from Cordish's people purporting to show that many signatures were bogus. Silkworth's apparent reasoning: This is an appropriation matter, and appropriations can't be decided in referendums, so whether or not the signatures are valid is irrelevant. Now the Court of Appeals seems to have blown Silkworth's logic apart, essentially ordering the referendum to be put on the ballot.

So the grounds barring the evidence casting doubt on the signatures have been wiped out. But will that evidence ever see the light of day? Even as it directed the referendum to go forward, the Court of Appeals remanded the case back to the Circuit Court. Does that mean Cordish can bring new challenges to the signatures in that venue? Or is the remand simply for the purposes of having the lower court issue the order for the referendum?

Posted by Jay Hancock at 9:38 AM | Permalink | Comments (4)
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It's hard to imagine Rosecroft Raceway surviving long-term. The track, which hasn't run a harness race regular harness racing in two years, says it'll shut down on July 1. (It has been getting patrons by showing remote races on TV but is still losing money.) But since it's an election year and the track has become a political issue, there are efforts to keep it on life support.

Former Gov. Robert L. Ehrlich Jr., who is running to regain the governorship, blames Gov. Martin O'Malley for the Three Stooges-caliber roll-out of Maryland slot machines. Slots could have saved Rosecroft if the General Assembly had approved them during his administration, as he wanted, Ehrlich says. Now the O'Malley administration is looking for ways to stop the closure.

Other plans have been floated. Senate President Mike Miller wanted to allow card-gambling at Rosecroft, but he didn't get his way. But if a business's core product -- harness racing -- is so unprofitable it stopped offering it two years ago, what's the point?

UPDATE: Reader Mark notes:

Rosecroft conducted 6 days of live pari-mutuel harness racing in 2009 when it hosted the Maryland Standardbred Fund races and the Maryland Sire Stakes - an overflow crowd of several dozen (including yours truly) turned out each day.

Posted by Jay Hancock at 8:44 AM | Permalink | Comments (17)
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Once and wannabe future Gov. Bob Ehrlich says that, if the legislature had approved his slots proposal, Rosecroft would be on more-solid financial ground. From the campaign statement in the Inbox:

“It’s a shame that these hard working Marylanders will soon be out of work, particularly since the closure of Rosecroft could have been avoided,” Ehrlich said. “Rosecroft’s closure is a sobering reminder of state government’s failure to design a viable gaming program in Maryland. I was proud to introduce a bipartisan plan for slot machines at Maryland race tracks as far back as 2003. Rosecroft would be on much stronger financial footing today had the legislature adopted that plan and had the O’Malley Administration not bungled implementation of its own flawed plan."

It's a fair point that if the General Assembly had approved slots when Ehrlich was governor, Maryland racetracks, and possibly Rosecroft, would be doing better. It's also accurate to say the slots rollout under O'Malley has been bungled. But the main bunglers are the would-be slots operators, led by the Maryland Jockey Club, not the politicians.

Posted by Jay Hancock at 3:27 PM | Permalink | Comments (6)
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Why is Judge Ronald Silkworth even bothering to hold hearings on the proposed referendum to block slots parlors at Arundel Mills mall? I thought the litigation was about determining whether the pro-referendum petition signatures were valid. But each time slots developer David Cordish's people profer evidence that some of the accepted signatures are phony, Silkworth disallows it.

First he rejected testimony on handwriting analysis. Now he refuses to hear from signers who said petition canvassers lied to them by saying the petition was pro-slots.

Reports Nicole Fuller in today's paper:

Silkworth also denied requests from Cordish attorneys to allow testimony from several other witnesses — Tom Chuckas, president of the Jockey Club; Heather A. Ford, president of CASM; a representative from FieldWorks; and Joseph Weinberg, a vice president at Cordish.

Judge Silkworth seems to be preparing for a precedent-setting exploration into a new branch of law: The faith-based ruling.

Posted by Jay Hancock at 9:37 AM | Permalink | Comments (8)
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Opponents of a big slots operation at Arundel Mills collected 40,408 signatures to put a referendum on the project on the November ballot. The Board of Elections tossed 17,441 signatures. But the 22,967 that remained are still enough to put the measure on the ballot. However, that's only about 4,000 more than the 19,000 required, reports Nicole Fuller in today's Sun -- a relatively thin margin.

Slots developer David Cordish is challenging 9,406 of the signatures, claiming 4,316 were forged and 1,203 don't match the name with which they're paired. Presumably Cordish's people will also be looking for signers who aren't registered voters or who don't live in the county.

It's hard to tell how rigorous the election board's analysis was, but it's probably fair to say that the board didn't analyze the signatures the way Cordish's lawyers are. State law requires the board to "Review all names and accompanying information on each signature page" and "Determine which signers are registered voters who meet the petition criteria and which are not registered voters or do not meet the petition criteria."

That doesn't exactly sound like Sherlock Holmes looks at the sheets. There's also an option for "random sampling" in which as few as 5 percent of the signatures could be examined. The biggest variable in Cordish's challenge may be the extent to which Ronald A. Silkworth agrees to hear a detailed analysis of the signatures in court.

Posted by Jay Hancock at 8:37 AM | Permalink | Comments (17)
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More amateur slapstick from Maryland's snakebit attempt to license and build slots parlors. Not only can't Canadian developer Michael Moldenhauer come up with $19.5 million in earnest money for a Baltimore slots license; he can't/won't pay the vendors who worked on the project. As Scott Calvert reports in today's Sun, folks who worked for Moldenhauer's Baltimore City Entertainment Group have claimed $771,000 of a $3 million deposit Moldenhauer made for work they performed but said they weren't paid for.

Those dunning Moldenhauer include PR queen Sandy Hillman and strategic consultant Michael Cryor, who dropped out of the project last month, telling the Sun's Annie Linskey: "A contentious appeal is not the relationship I want to have with my city and state." Especially if he's not getting paid!

Add to this delays for the Arundel Mills slots operation, the pratfalls of the De Francis family, the bankruptcy of the parent of Laurel Park and Pimilco racetracks and you have set up a casting call for Abott & Costello.

Posted by Jay Hancock at 9:12 AM | Permalink | Comments (17)
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Savvy column by Josh Kurtz in Center Maryland on Senate President Miller's surprise declaration that he wants slots in his home county:

But this is the first anyone has heard of Miller agitating for slots specifically in Prince George’s — even as the state is struggling to get its overall slots program going. Miller mentioned the National Harbor resort, the equestrian center in Upper Marlboro and Rosecroft racetrack as possible sites for slots in the county. Take note, conspiracy theorists: Rosecroft, which already has a boat-load of high-priced, high-powered lobbyists, recently hired another, Gerard Evans, convicted felon and a longtime protégé of Miller’s.

Posted by Jay Hancock at 11:12 AM | Permalink | Comments (0)
Categories: Slots
        

So the Anne Arundel County Council finally approved a huge slots parlor (can it be a parlor when it's the size of a Super Wal-Mart?) for Arundel Mills mall, reports Nicole Fuller. Substantial slots money promises to start flowing into the state treasury, but it won't come in time to save policymakers from difficult budget decisions next year. And even when the slots faucet is full open, state budget headaches will remain.

Slots opponents vow to seek and win a county referendum on slots at Arundel Mills. It's a long shot. They have to get 19,000 signatures within 45 days to get the measure on next fall's ballot, reports Fuller. There are about 320,000 registered voters in the county, so slots opponents have to get signatures from more than one in every 20 Arundel voters. It's hard to imagine that many people care. I can't immediately find a tally of how Arundel voted on the 2008 statewide referendum authorizing slots, but as a state Maryland overwhelmingly favored slots.

UPDATE: Pulled from comments. Kent (thanks!) says the AA slots vote was:

149,604 for slots; 103,814 against. A 59-41% split in AA Co. alone, just about the same as the state.

Slots interests will aggressively challenge every petition signature they can, and then some. If nothing else the costs facing Arundel Mills slots opponents are daunting.

Continue reading "Don't bet on an Arundel anti-slots referendum " »

Posted by Jay Hancock at 8:49 AM | Permalink | Comments (20)
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The Cordish Co., Simon Property and others are having a jobs and vendor fair Thursday for people who want to do business with Power Plant Entertainment, Casino Resorts Maryland. It's at Arundel Mills Mall, near the putative slots site. Problem: The county hasn't approved the project. The developers don't have a casino license.

Perhaps it's their attempt to push the process and show how much local dough will be spent and jobs created locally if the project goes forward. But the county councilmembers -- doing their best Hamlet, brows furrowed, hands wringing -- are unlikely to be impressed. They may be annoyed.

I asked Cordish spokeswoman Danielle Babcock whether the job fair might be premature, given the lack of approval by the county. She replied: "We expect approvals. We have received hundreds of calls from job seekers and potential vendors about the project. This is a Career & Vendor Information Expo to prepare local contractors, vendors and career candidates for the estimated 4,000 jobs anticipated."

Says the press release from Cordish et. al.:

(Baltimore, MD) – PPE Casino Resorts Maryland, LLC (“PPE MD”) announced its plans today to host a Career & Vendor Information Expo at Arundel Mills Mall in an effort to prepare local contractors, vendors and career candidates for the estimated 2,500 construction and 1,500 permanent jobs anticipated with the development of a world-class gaming facility at Arundel Mills Mall. The Expo will be held on Thursday, November 19, 2009 from 11am – 2pm in the Arundel Mills Mall food court.

Continue reading "Arundel casino developers: We're hiring, buying!" »

Posted by Jay Hancock at 6:33 AM | Permalink | Comments (16)
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The pathetic lengths to which Magna Entertainment will go to obtain slots at Laurel Park just got longer. First Magna and boss Frank Stronach botched their bid for a license. They didn't put up the required $28.5 million in earnest money. Then they threw a fit after their bid was rejected, arguing that they didn't pay because the money wasn't refundable. Then they argued that, because the state was looking at changing the sites for some of the successful bidders, that was tantamount to reopening the process and they should be allowed reentry.

Now they're throwing partner Joe De Francis and his partners under the bus, hoping that their absence will let the state countenance Magna's bid. De Francis et. al. were supposed to get 65 percent of Laurel slots profits for the first five years and a diminishing amount over the next 15 years. De Francis personally would get 11.7 percent for the first five years, documents show -- millions. Magna is asking the bankruptcy court to terminate that deal.

One question: What took Magna so long? Bankruptcy is all about rejecting contracts. The profit-sharing contract with De Francis is at the tiptop of the list of binding deals that Magna regrets. Even if Magna doesn't get a license in this round, jettisoning De Francis would yield a theoretical greater share of slots profits for any future ventures. That makes Magna look look more valuable, which is what its creditors want. But for the owner of Pimlico and Laurel to get slots anytime soon is still a long, long shot.

Posted by Jay Hancock at 9:11 AM | Permalink | Comments (15)
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"This symphony has a long way to go," I wrote six months ago about the desperate attempt by Laurel Racing, the Maryland Jockey Club and Magna Entertainment to ask for a do-over in their botched bid for a slots license. We're now up to -- oh -- the third movement. Molto lacrimoso.

The companies (or somebody. Maybe it's Joe DeFrancis and other partners who stand to make a mint if Laurel Park gets slots) are wasting more money on lawyers to try to get the state to reopen slots bidding. Their argument: Since the state is taking modified offers from qualifying bidders, it should start over and let everybody submit new packages.

Nice try. Here is the way to think about this. Imagine you're buying a house. It is customary to put up earnest money -- $1,000 or so. This demonstrates that you have at least a minimum amount of scratch, a small token of solvency implying that you can consummate your offer. That's when the negotiating begins. The seller makes a counteroffer, you reciprocate etc. Without the earnest money you don't even get to sit down at the table.

Laurel Racing and the Jockey Club didn't put up the earnest money. They were supposed to front $28.5 million for their bid. Now they're accusing the state of changing the slots award rules in the middle of the game. Actually, the rules were quite clear, and Laurel Racing didn't abide by them. There was reason to think that the entities that ran Pimlico and Magna into the ground would not be good bidders. When they failed to put up the bidding deposit, they proved that proposition correct. The system worked.

Posted by Jay Hancock at 5:30 AM | Permalink | Comments (3)
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Magna Entertainment, owner of Pimlico Race Course and Laurel Park, got out the Stradivarius Friday for Maryland officials by announcing it had defaulted on a loan secured by the racetracks. That Magna Entertainment is near bankruptcy is not news. That it announced its loan defaults to PNC Bank only a day after it pleaded in Anne Arundel County Circuit Court that its hilariously botched slots bid for Laurel be revived was no accident.

In more than an hour of impassioned monologue yesterday in Anne Arundel Circuit Court, [Magna lawyer Alan] Rifkin narrated a wide-ranging argument that suggested Maryland bureaucrats might be committing a "felony" if they were to refund fees, and he implored Judge William C. Mulford II to prevent "enormous harm" to Maryland horse racing by preserving Laurel's chances for slots.

Rifkin's rif was the overture. Magna's default announcement was the first movement. This symphony has a long way to go. Nothing any judge or slots commission can do can match the enormous harm already done to Maryland horse racing by Magna. Just file for Chapter 11, sell yourself to Churchill Downs and get it over with.

Posted by Jay Hancock at 11:41 AM | Permalink | Comments (6)
Categories: Slots